Key takeaways from Rank Group’s latest financial results

Rank Group posted a modest 7% rise in NGR in its latest reporting period as underlying profit fell 52% due to costs mainly driven by its land-based venues.

In H2, the operator saw certain costs like employment balloon by £15.9m and energy costs jump by £5.4m, which led to this decrease in profit compared to what was produced last year.

However, despite the falling profit, the group’s land-based and digital arms reported revenue growth while the operator continued to champion its in-house tech stack for driving digital gains.

Success outside of its UK heartlands in Spain via its Enracha brand has seen Rank Group set its sights on neighbouring Portugal, with plans to become a leading bingo operator in the offing.

Speaking to EGR, Rank CEO John O’Reilly touched on a number of pressing topics, including what’s next for the digital side of the business and his thoughts on what the white paper into the Gambling Act 2005 review will mean for the firm.

Here we Iberi-go

In its results, Rank praised the launch of YoSports before the World Cup and the overall performance of its brands in Spain and is committed to further supporting the YoBingo, YoCasino and Enracha brands with further initiatives going forward.

O’Reilly spoke about the success found in H2 and what is still to come for the firm. He said: “Yo is a wonderful brand that has a great relationship with its customers, and it’s fairly unique in that regard, and we are developing a lot for the brand for Spanish customers. We are looking to develop bigger offerings, which is at a formative stage at the moment, but we expect to launch that in the coming months and see how that goes.

“The [Spanish] business is a nice business, growing by double digits in the early part of this year despite all the marketing restrictions in Spain, which is too many in my opinion, but that’s where we are.”

Rank Group is also in the process of securing a licence in Portugal, with the CEO explaining why the market has potential to be a welcome home for bingo.

O’Reilly commented: “Portugal has been a tough process because the regulator has never had to licence a venue operator before. So this is new territory for the regulator, so there is no tried and tested process, and we have been working our way through it systematically. Once it is over the line, we are confident as bingo is a big game in Portugal, and we will be the only brand fully licensed in the country, which is a good opportunity for us.”

All in one

At the back end of last year, Rank moved the last of its brands, Grosvenor, over to its in-house tech platform Stride Gaming.

The move made a mark firm’s H1 results but came to fruition in H2, with all areas of its digital business increasing NGR by a minimum of 8%.

O’Reilly believes that the move to the proprietary platform was the biggest factor in the digital arm producing positive results.

He said: “I think it is the biggest factor. Historically we were not in control, but now the pace of change and the rate at which we deliver new products, new features and the use of AI is totally under our own control. We have a fantastic team in Cape Town and continue to scale that tech team. We are now also using in-house app development.

“We are in a good place at the moment, but there is still more work to do around scalability around improving the performance of the platform. One big thing we are doing is moving to the cloud, which we expect to be complete in the next weeks. We are also looking into a single content management system to serve our brands. We won’t complete that until around this time next year.”

Whitepaper wishes

O’Reilly has been forthcoming in his happiness with the white paper into the Gambling Act 2005 review in the past. The document gave a welcome boost to land-based operators, and with Rank’s digital division still trailing its venue arm in terms of revenue, a leg up to land-based will always be welcome.

Venue revenue for the full financial year stood at £476.8m compared to digital’s £202.9m.

Two specifics the CEO explained were how the group’s digital arm is expected to be unscathed by the white paper recommendations, as well as how affordability checks could potentially hamper operations.

He commented: “When it comes to digital, I think it is all to play for really. We don’t believe that the changes that will come out of the current Gambling Commission consultations will have a material impact on our business because we are already pretty tight regarding compliance.”

On affordability checks, O’Reilly said: “We need frictionless checks. Most customers can afford to spend what they do on gambling, and people don’t want unnecessary or inconvenient challenges on what they are spending their money on. It’s about ensuring you have the balance in protecting customers. We’ve got to ensure customers are spending within their means but need to be measured in how we deliver that. Hopefully, the Gambling Commission will come up with the right answer from these consultations.”